By Our Reporter
With less than three months to the general elections, President Bola Tinubu has asked the National Assembly to approve a supplementary external borrowing plan of $20.52 billion and €1.045 billion for 2026 and 2027, renewing concerns about Nigeria’s growing debt burden and whether successive loans are translating into tangible improvements in citizens’ lives.
The letter was read by Senate President Godswill Akpabio on Tuesday and referred to the Senate Committee on Local and Foreign Debts. The proposed package, worth approximately $21.7 billion, is intended to finance what the President described as “critical infrastructure”, including power, transportation and healthcare projects across the 36 states and the Federal Capital Territory. The request is awaiting legislative scrutiny and has not yet been approved or disbursed.
The Debt Management Office (DMO) puts Nigeria’s total public debt at ₦166.79 trillion as of June 30, 2026. The figure represents a substantial increase from ₦87.38 trillion in June 2023, although the difference cannot be treated as the total amount borrowed by Tinubu’s administration. The increase also reflects exchange-rate movements affecting existing foreign-currency debt and other debt adjustments. The government has disputed claims that the entire increase represents fresh borrowing.
The Presidency has defended the borrowing strategy, arguing that the critical issue is not whether the government borrows but how the funds are used. Presidential spokesman Bayo Onanuga has said, “It is not a sin to borrow,” adding that “The issue is not borrowing; it is what you do with the borrowed funds.” He has also argued that Nigeria’s debt is about 35 per cent of gross domestic product (GDP), citing investments in infrastructure, including the Buruku Bridge in Benue State.
Tinubu has said the proposed programmes would “generate employment, promote skill acquisition, foster entrepreneurship, reduce poverty and enhance food security”. Such investments could stimulate economic activity, improve productivity and raise living standards. His administration has pursued infrastructure financing, including projects linked to the Sokoto–Badagry Superhighway and port rehabilitation. The 2026 budget also allocates ₦26.08 trillion to capital expenditure. However, capital allocations and announced projects do not, by themselves, prove that borrowed funds have been fully deployed, projects completed or citizens’ lives improved.
Economic analysts argue that a credible assessment of the loans requires transparent, project-by-project records showing the amounts borrowed and disbursed, what the funds financed, implementation schedules and measurable results. The quality of project selection, procurement, completion and maintenance will determine whether the investments generate sufficient economic returns to justify their cost. Budget-support borrowing, meanwhile, helps meet government financing needs but does not automatically establish that expenditure is productive.
The repayment burden is another concern. Nigeria’s 2026 budget provides ₦15.52 trillion for debt servicing, while Tinubu has said the country expects to spend $11.6 billion servicing debt this year. In May, the President warned that debt payments were squeezing resources for development, saying: “Every single dollar that leaves our treasury to pay punitive interest rates is a dollar that did not go into our steel sector, our textile mills, our agro-processed, or our digital industries.”
Additional borrowing, many say, would create further repayment obligations and expose public finances to exchange-rate and interest-rate risks, particularly because the proposed loans are denominated in foreign currencies. They argue that if the projects fail to generate adequate economic returns or strengthen government revenue, future budgets could come under greater pressure, leaving fewer resources for healthcare, education and other essential services.
For Nigerians, the ultimate test is not how much financing the government secures but whether it delivers reliable electricity, better roads and hospitals, more jobs, stronger businesses and lower living costs. The National Assembly must therefore scrutinise the new request against existing debt obligations, borrowing terms and the government’s record of project delivery, while demanding public disclosure and independent audits.
Economic analysts warn that without effective safeguards, fresh loans could deepen Nigeria’s debt burden without delivering commensurate benefits, while adding that with disciplined investment, transparent implementation and verifiable results, however, borrowing could help close critical infrastructure gaps and support sustainable economic growth.